Remote work has gained popularity since the COVID-19 pandemic. As a result, many workplaces now have a remote work policy in place. As an employer, you must know your legal obligations regarding laws that govern remote workers.
The Fair Labor Standards Act (FLSA) reinforces the same employment laws for remote workers, including minimum wage laws, compensation benefits for working hours and overtime, business expenses, privacy, anti-discrimination, and equal pay, leave, and labor law notifications.
While these laws are yet to be refined for those working from home, most states uphold the present laws regardless of whether the employees are offsite. Read on to learn about employment laws for a remote workforce.
For remote workers, employers should be concerned about the application of laws where the employee is physically working, and there is the possibility for multiple state laws to apply.
As a rule of thumb, the state and local laws of the physical location where the employee is working will govern. For example, if an employee is 100% remote, and working from home in Virginia, but the employee is receiving work from a Maryland office, Virginia employment laws will apply.
One of the most common lawsuits against employers is a lawsuit for unpaid overtime, or misclassification under the Fair Labor Standards Act, the federal law that governs overtime. So, it’s essential to understand the difference between exempt and non-exempt employee classifications, to determine whether an employee qualifies for overtime pay.
According to the federal Fair Labor Standards Act (FLSA), exempt employees are not eligible for overtime pay and receive a fixed salary per period despite working beyond their designated hours. Nonexempt employees should receive overtime pay when they exceed 40 hours a week.
Typically, hourly employees are nonexempt, with some exceptions.
You must comply with the minimum wage requirements for your nonexempt employees based on where they work. The highest amount should be imposed for areas with multiple yet different minimum wage requirements. For example, if the state minimum wage is higher than the local minimum wage, you will need to apply the state minimum wage rate.
Employers must pay the working hours of remote employees despite being offsite. Without proper tracking, this could become tricky for many offices or businesses. Although many workplaces often assume employees put in their 40 hours a week, others resort to software time trackers to ensure that their records are accurate.
The Fair Labor Standards Act (FLSA) requires employers to keep up to three years’ worth of employee pay records and allows employers to choose what timekeeping system works best for them. If your company doesn’t keep proper timekeeping records for your employees, then you are opening your company up to potential legal liability.
Aside from the expected working hours, employers also need to pay nonexempt overtime. The required additional overtime pay is 1.5 times the regular rate of the employee for each hour worked over 40 hours in a week.
For remote workers, these overtime hours must be tracked to ensure that they have indeed used the time for work-related tasks. Also, it’s best to have the overtime approved in writing first, with the proper permission. Lipp Law assists companies with employee handbook templates that include language about overtime protocols that protect your company.
Each state will have different paycheck laws that govern its remote employees. For example, when an employee is terminated, each state has different laws on when the employee must receive their last paycheck. In Virginia, an employer needs to pay an employee by the following pay period.
Also, state law governs how often an employee should get paid, and what information needs to be included on an employee’s paystub.
Employers must cover reimbursement for work-related expenses, especially if it reduces an employee’s pay below the minimum wage. This legal requirement comes from the federal Fair Labor Standards Act (FLSA).
Currently, 10 states, the District of Columbia, and Seattle, Washington have established reimbursement policies for necessary work-related expenditures. The 10 states are California, Illinois, Iowa, Massachusetts, Minnesota, Montana, New Hampshire, New York, North Dakota, and South Dakota.
What counts as a business expense must be put into writing. Business expenses often include internet access, phone bills, tools, and work equipment. Some companies and offices even pay for a home office set up. Nonetheless, these expectations should be communicated in the form of a written remote work policy if your company has remote workers.
Employee monitoring can become an aspect of a company’s remote work policy to ensure that working hours are spent accordingly. Some employers choose to use installed software on their business equipment to measure data points like keystrokes and eye movements. Other employers choose to monitor their employees or the general public with video cameras, and employers should be mindful of state surveillance laws that apply. Generally, under Virginia law, an employer can use video surveillance in work areas so long as it is not invasive, such as in break rooms. Obviously, employers should not use surveillance in areas like restrooms or changing areas.
Since those working from home may be using their own equipment, data privacy can come into question. It is crucial to create common ground and establish boundaries as to what level of monitoring employers can perform on their remote working employees. An employee handbook can outline what type of privacy employees can expect.
In particular, many states have computer laws about what type of actions employers can take on a person’s private computer. For example, Virginia has the Virginia Computer Crimes Act, its own computer invasion of privacy law, and a computer trespass law that Virginia employers should be aware of to avoid potential liability as it relates to computer use.
Multiple states have laws requiring employers to tell their employees of electronic monitoring, including Connecticut, Delaware, New York, and Texas. Even without a legal requirement, it’s recommended to inform your staff of surveillance to avoid any potential issues or legal liability.
Moreover, data privacy involving individual information such as social security numbers, medical data, credit card numbers, passwords, usernames, etc., must be protected at all costs by the employer.
Medical information that is collected for business reasons must be kept in separate, secure files, in accordance with the Americans with Disabilities Act (ADA).
If your company is recording work phone calls, it will want to make sure that the recording is in compliance with state laws regarding recording as well as wiretapping laws. For example, in Virginia, one-party consent is required for telephone call recording, meaning that if one party to the communication consents to the recording, that is legally sufficient, but our general recommendation is to inform parties that they may be recorded on business calls, to avoid any potential issues. Each unique employment law situation calls for its own specific recommendation.
The fact that employees decide to work outside the office does not exclude them from the coverage of the anti-discrimination laws and their entitlement to equal pay. Right at the beginning, even as early as a job posting, you should avoid mentioning age, gender, race, religion, disability, pregnancy, or any other protected class. Job postings and descriptions should be periodically reviewed by employment law counsel to ensure legal compliance.
Employees working remotely should have the same access to equal pay, benefits, and opportunities. For example, if you’re going to provide training to in-office workers, ensure you prepare a virtual alternative for those working at home or elsewhere.
It is the employer’s responsibility to ensure that workers have a safe and healthy working environment – even if it’s outside their office. For this reason, programs, and training on protecting employees’ mental health and reporting health issues should be conducted.
Employers should ensure that they have employee handbook language specifying protocols on how to report workplace injuries or mistreatment, and employers should ensure that they are compliant with state laws on workers compensation insurance.
Moreover, anti-harassment and discrimination laws likely apply to your company, and can vary by local, state, and federal law depending on where your employees are located and the number of employees at your company. An experienced employment lawyer can advise your company on what employment laws apply to your company and how to best protect your workforce.
Employees working remotely may be entitled to medical leave and paid time off. According to the federal Family Medical Leave Act (FMLA), employees have up to 12 weeks annually of unpaid leave for family or medical reasons, with the assurance that they still keep their job intact. The FMLA provides family and medical leave to qualifying employees working at companies with 50 or more employees. Some jurisdictions such as Washington, DC have expanded FMLA, which applies to employers with 20 or more employees, and provides up to 16 weeks of unpaid sick or family leave per 24 months of employment.
On the other hand, paid family leave (PFL) is available (or soon to be available) in California, Colorado, Connecticut, Delaware, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island, Washington, and the District of Columbia. But the eligibility and time spans vary. Other jurisdictions, such as Washington, DC, provide paid sick leave to applicable employees.
The Department of Labor (DOL) requires certain employers to post written notifications about labor laws and employee rights in conspicuous areas. While these notifications can be easier in an office with a bulletin board and central break room, remote workers can be notified of Department of Labor (DOL) laws through an electronic database and regular notifications.
The Department of Labor (DOL) permits electronic postings if all employees work remotely, the employer regularly sends notifications electronically, and if the postings are readily available to employees at all times. If you have a mix of remote and in-person workers, you still need to post a physical copy at your office location(s) in addition to electronic notifications.
Employees working remotely in Virginia are entitled to the benefits and coverage of employment laws regulated by the federal Department of Labor (DOL), the Virginia Department of Labor and Industry (DOLI), and Virginia laws, spanning topics including compensation, anti-discrimination, leave, data privacy, pay transparency, equal pay, equal treatment, worker classification, and overtime.
There are multiple recent Virginia employment laws that Virginia employers should be aware of, including the Virginia Values Act, Virginia’s worker misclassification law, Virginia’s non-compete law, and Virginia’s anti-retaliation law, among others.
Maryland is more employee-friendly than Virginia and imposes similar employment laws as other states but with certain differences in eligibility and wage. In particular, Maryland has a higher minimum wage than Virginia, has expanded employee pay protections, and Maryland employers will want to carefully review county employment regulations as well, which can vary (see, for example, Montgomery County minimum wage requirements).
For payment of paid time off when an employee is terminated, if a Maryland employer does not have a written policy stating it will not pay out accrued unused leave, and the policy wasn’t provided to a worker upon hire, the Maryland employer needs to pay out accrued unused leave. This is different from Virginia, where employers that don’t have written paid time off (PTO) policies do not have to pay out accrued unused leave to employees. Also, Maryland employers have to provide this PTO policy to a worker upon hire, and if they don’t, they need to pay out accrued unused PTO to a departing employee.
Employers with employees working remotely in Washington, DC can expect to go through more bureaucratic steps to do business there. DC business owners know all too well that you have to pay careful attention to business registration filing deadlines to avoid late fees, and that there are several added costs to doing business in Washington, DC. If you are a business owner and are thinking of expanding into Washington, DC, it is helpful to speak with a business and employment lawyer to ensure you are prepared for all the additional rules that apply to businesses operating in the District.
DC imposes the Accrued Sick and Safe Leave Act (ASSLA), which allows employees working in DC half the time to take paid leave for medical reasons. However, they must prove that their primary place of employment is in DC.
Additionally, DC requires employers to pay into a Paid Family Leave (PFL) fund that DC employees can avail themselves of, similar to unemployment benefits.
DC Courts can be very difficult to navigate as an employer, particularly DC Superior Court since the dockets do not move quickly and generally employers may have to settle a case that may have been wrongfully filed against them by an employee. DC Superior Court is a forum that employers should avoid litigating in if possible. Maryland and Virginia courts have much quicker dockets, and are more business-friendly jurisdictions to litigate employment and business law cases in.
DC is generally more employee-friendly than Virginia, and is similarly employee-friendly like Maryland, but overall, Maryland has more employment protections to employees than DC, and more common law predictability for purposes of employment litigation.
DC has expanded protected employment classes compared to other jurisdictions, and has protected classes such as political affiliation, physical appearance, unemployment, and status as a victim or family member of a victim of domestic violence, a sexual offense, or stalking.
For payment of paid time off when an employee is terminated, if a DC employer does not have a written policy stating it will not pay out accrued unused leave, the DC employer needs to pay out accrued unused leave. This is different from Virginia, where employers that don’t have written paid time off (PTO) policies do not have to pay out accrued unused leave to employees.
For additional information on DC employment laws.
Remote work brings plenty of comfort for many employees, especially during a time when going to the office could be unsafe. However, from an employer’s perspective, several factors must be considered, such as local and state laws, employee monitoring and tracking, reimbursement for business expenses, paid time off policies, and many more.
Contact the experienced legal counsel at The Lipp Law Firm to ensure that you are in compliance with applicable state laws for your remote workforce. Legal issues can hinder you from providing the best working environment for your employees. For fast, cost-effective employment law advice for your organization, call Lipp Law today.
Are you a business owner or executive in the DMV area (DC, Maryland, Virginia)?
Or maybe you just want to hear our Lipp Law updates (thanks for your support! 🙏)?
If so, you should check out Lipp Law's Employment Law Newsletter. Expect regular updates about employment law and the team here at Lipp Law, focused on serving you - the backbone of our DMV business community.
If you like to keep your business compliant with employment law changes, subscribe below!